There are more signs Canada's housing market is facing a significant slowdown after a double-digit percentage drop in home construction starts last month and a forecast that sales and prices will slide this year.
As the recession digs in and the unemployment rate rises, economists say nervous consumers are standing still when it comes to buying and selling real estate.

The results are increasing numbers of dwellings on the market, dropping prices and a slowdown in construction. "The Canadian housing correction is in full swing, having a wide impact across the country," BMO Capital Markets economist Robert Kavcic commented Monday.

Canada Mortgage and Housing Corp. reported housing starts fell to a seasonally adjusted annual rate of 153,500 units in January, down 10.9 per cent from December in the steepest monthly drop since March 1995.

It was the fifth straight decline and left home construction at its slackest pace since 2001, well below market expectations of 169,000.

Also Monday, the Canadian Real Estate Association predicted house prices nationally will fall eight per cent this year as the number of Multiple Listing Service sales tumbles 16.9 per cent to 360,900 units.
Three months ago, the association was forecasting only a 2.1 per cent price slippage for 2009 on a three per cent decline in the number of sales.

The good news is that recently announced Federal Budget recognized the importance of the housing sector to the economy. This budget will put more money in the pockets of home buyers and owners.

The Jan. 27 budget included a plan to expand the insured mortgage purchase program by $50 billion to $125 billion, which is meant to encourage banks to increase mortgage lending. One of the most important announcements in the Budget was a change to the Home Buyers’ Plan that Realtors have long been calling for. Specifically, the Budget proposes to increase the maximum amount that individuals can withdraw, tax-free, from their RRSP to put towards the down payment on a home, from $20,000 to $25,000. Realtors worked hard to ensure that the government understood that, while this program has been extremely successful since it was first implemented in 1992, its usefulness to home buyers was deteriorating because the withdrawal limit had not kept pace with inflation. The increase in the limit announced with the Budget addresses this concern.

Another important Budget announcement for home buyers is a tax credit that will help to offset the closing costs associated with housing purchases. Closing costs can include things like legal fees and land transfer taxes. They can represent a significant cost for many buyers. The Federal Budget recognized this and includes a First-Time Home Buyers’ Tax Credit of 15 per cent on up to $5,000 of costs associated with the home purchase. This means that first-time home buyers could be eligible for a tax credit of up to $750.

The Federal Budget also includes an initiative that helps both current home owners and home buyers considering properties that may benefit from renovations. The Home Renovation Tax Credit provides a 15 per cent credit that can be claimed on the portion of eligible home renovations exceeding $1,000, but not more than $10,000, which means that home owners could be eligible for a tax credit of up to $1,350. This credit would apply to eligible home renovation xpenditures, after January 27, 2009 and before February 1, 2010, on one or more of an individual’s personal use properties.

Moderated housing prices combined with low interest rates could present excellent long-term investment and homeownership opportunities in the GTA housing market. REALTORS® can help potential home buyers and investors identify value in today’s market.

Halibut with Roasted Grape Tomato Salsa

You could also serve this dish with a side of some steamed basmati rice. This is a simple dish with amazing flavour.

Ingredients:

1 1/2 cups grape tomatoes, cut in half, crosswise (375 ml)
12 red pearl onions, blanched and peeled
splash of olive oil, for salsa
Grated zest and juice of 1 lime, for salsa
Several thyme sprigs, for salsa
Coarse salt and freshly cracked black pepper
4 pieces skinless halibut fillet, each fillet about 6-ounces/170 grams)
1 tbsp fresh thyme, chopped, for fish (15 ml)
Coarse salt and freshly cracked black pepper
Grated zest of 1 lime, for fish
2 tbsp olive oil, for fish (30 ml)
Lime wedges, for serving if desired
1 bunch watercress, for serving if desired

Directions:

Preheat oven to 375 degrees F.
For the roasted tomato salsa: add a splash of olive oil, tomatoes, pearl onions, grated zest and juice of lime, and thyme sprigs to a medium roasting pan. Season the tomatoes with salt and pepper. Roast in oven just until onions and tomatoes start to soften, about 7 to 10 minutes.

Meanwhile season fish with salt and pepper, zest from 1 lime and chopped thyme. Add 2 tbsp. olive oil to large skillet or sauté pan over medium high heat. When pan is hot, sear fish on both sides, about 1 to 2 minute per side.
Transfer halibut to roasting pan after vegetables have roasted for about 7 to 10 minutes. Roast fish with vegetables, moving vegetables in the pan to surround the fish. Continue to roast until fish is cooked through and firm, about 7 to 9 minutes. Serve fish and roasted salsa with fresh watercress. Drizzle each plate with some of the pan juices.